SHIVLAL Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) THE assessee carried on the business of manufacturing exercise-books. Unfortunately he was unsuccessful in the business which ran into losses. For the purpose of the business the assessee had taken loan from the Maharashtra State Financial Corporation. The said creditor filed a suit for recovery of the loan given to the assessee for the business. Decree was passed and in execution of the decree, old machinery, like paper cutting machine, one stitching machine, file creasing and file punching machine were attached. The attached property was to be put to public auction. But before that, the assessee made an application for permission to sell the attached property privately to one Vithalsingh Rana of Anand Printing Press at Gondia, for a sum of Rs. 14,500. The District Judge, by order dated July 13, 1983, granted the permission on the condition that the sale proceeds will be deposited with the creditor. Accordingly, the property was sold as permitted ant the amount was deposited with the creditor. Sales tax was levied on this sale by the sales Tax Officer. This levy was confirmed in the first appeal by the Assistant Commissioner and in the second appeal by the Tribunal. An application was filed by the assessee to refer the following questions to the High Court under section 61 of the Bombay Sales Tax Act, 1959 ("the act") :

(2.) ON undisputed positions it seems to us that the order passed by the Tribunal was perfectly correct. It was a clear-cut case of a "sale" within the meaning of section 2 (28) of the Act. It was not a case of distress sale. The facts that the assessee had no choice to sell the property and that permission of the court was required do not alter the position in law.

(3.) THE last surviving point is whether the sale was casual in nature and not in the course of business. The term "business" is defined under section 2 (5a) of the Act and the amended definition as it stood during the relevant period (January 1, 1983 to September 1, 1983) read thus : "'business' includes any trade, commerce or manufacture or any adventure or concern and any transaction in connection with, or incidental or ancillary to, such trade, commerce, manufacture, adventure or concern, and any transaction in connection with, or incidental or ancillary to, the commencement or closure of such trade, commerce, manufacture, adventure or concern;" under the circumstances, this transaction amounted to "sale" in the course of the business as rightly held by the Tribunal in its detailed order passed in the second appeal as well as the order rejecting the application for reference.